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Quanta Services Inc (NYSE:PWR)
Beneish M-Score
-2.65 (As of Today)

The zones of discrimination for M-Score is as such:

An M-Score of less than -2.22 suggests that the company is not an accounting manipulator.
An M-Score of greater than -2.22 signals that the company is likely an accounting manipulator.

Quanta Services Inc has a M-score of -2.65 suggests that the company is not a manipulator.

PWR' s 10-Year Beneish M-Score Range
Min: -3.33   Max: -1.18
Current: -2.65

-3.33
-1.18

During the past 13 years, the highest Beneish M-Score of Quanta Services Inc was -1.18. The lowest was -3.33. And the median was -2.44.


Definition

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Z-Score) or business trend (F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of Quanta Services Inc for today is based on a combination of the following eight different indices:

M=-4.84+0.92 * DSRI+0.528 * GMI+0.404 * AQI+0.892 * SGI+0.115 * DEPI
=-4.84+0.92 * 0.9188+0.528 * 1.068+0.404 * 0.9207+0.892 * 1.1904+0.115 * 0.9824
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0472+4.679 * -0.0426-0.327 * 1.1913
=-2.65

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

This Year (Mar15) TTM:Last Year (Mar14) TTM:
Accounts Receivable was $1,643 Mil.
Revenue was 1886.956 + 2052.982 + 2171.144 + 1864.55 = $7,976 Mil.
Gross Profit was 252.661 + 327.03 + 352.971 + 281.448 = $1,214 Mil.
Total Current Assets was $2,388 Mil.
Total Assets was $6,141 Mil.
Property, Plant and Equipment(Net PPE) was $1,480 Mil.
Depreciation, Depletion and Amortization(DDA) was $202 Mil.
Selling, General & Admin. Expense(SGA) was $699 Mil.
Total Current Liabilities was $1,124 Mil.
Long-Term Debt was $115 Mil.
Net Income was 53.484 + 66.576 + 94.648 + 81.082 = $296 Mil.
Non Operating Income was -0.212 + -0.466 + -0.378 + -1.233 = $-2 Mil.
Cash Flow from Operations was 189.227 + 273.301 + 64.119 + 32.756 = $559 Mil.
Accounts Receivable was $1,502 Mil.
Revenue was 1762.574 + 1817.623 + 1645.132 + 1474.377 = $6,700 Mil.
Gross Profit was 272.071 + 302.843 + 273.053 + 241.284 = $1,089 Mil.
Total Current Assets was $2,214 Mil.
Total Assets was $5,827 Mil.
Property, Plant and Equipment(Net PPE) was $1,270 Mil.
Depreciation, Depletion and Amortization(DDA) was $170 Mil.
Selling, General & Admin. Expense(SGA) was $561 Mil.
Total Current Liabilities was $982 Mil.
Long-Term Debt was $5 Mil.



1. DSRI = Days Sales in Receivables Index

Measured as the ratio of days’ sales in receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI=(Receivables_t / Revenue_t) / (Receivables_t-1 / Revenue_t-1)
=(1642.675 / 7975.632) / (1501.857 / 6699.706)
=0.20596173 / 0.2241676
=0.9188

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI=GrossMargin_t-1 / GrossMargin_t
=(GrossProfit_t-1 / Revenue_t-1) / (GrossProfit_t / Revenue_t)
=(327.03 / 6699.706) / (252.661 / 7975.632)
=0.16258191 / 0.15222743
=1.068

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than plant, property and equipment to total assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (2387.64 + 1480.097) / 6140.834) / (1 - (2214.457 + 1269.656) / 5826.62)
=0.37016096 / 0.40203531
=0.9207

4. SGI = Sales Growth Index

Ratio of sales in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI=Sales_t / Sales_t-1
=Revenue_t / Revenue_t-1
=7975.632 / 6699.706
=1.1904

5. DEPI = Depreciation Index

Measured as the ratio of the rate of depreciation in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI=(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) / (Depreciation_t / (Depreciaton_t + PPE_t))
=(169.554 / (169.554 + 1269.656)) / (201.687 / (201.687 + 1480.097))
=0.11781047 / 0.11992444
=0.9824

6. SGAI = Sales, General and Administrative expenses Index

The ratio of SGA expenses in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI=(SGA_t / Sales_t) / (SGA_t-1 /Sales_t-1)
=(698.945 / 7975.632) / (560.66 / 6699.706)
=0.08763506 / 0.08368427
=1.0472

7. LVGI = Leverage Index

The ratio of total debt to total assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase$sgai= in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((115.002 + 1124.31) / 6140.834) / ((4.556 + 982.475) / 5826.62)
=0.20181493 / 0.16940027
=1.1913

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA=(IncomefromContinuingOperations_t - CashFlowsfromOperations_t) / TotalAssets_t
=(NetIncome_t - NonOperatingIncome_t - CashFlowsfromOperations_t) / TotalAssets_t
=(295.79 - -2.289 - 559.403) / 6140.834
=-0.0426

An M-Score of less than -2.22 suggests that the company will not be a manipulator. An M-Score of greater than -2.22 signals that the company is likely to be a manipulator.

Quanta Services Inc has a M-score of -2.65 suggests that the company will not be a manipulator.


Related Terms

Altman Z-Score, Piotroski F-Score, Accounts Receivable, Revenue, Gross Profit, Total Current Assets, Total Assets, Property, Plant and Equipment, Depreciation, Depletion and Amortization, Selling, General & Admin. Expense, Total Current Liabilities, Long-Term Debt, Net Income, Non Operating Income, Cash Flow from Operations


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Quanta Services Inc Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.09231.10051.0510.77640.9861.0181.08390.98010.98351.0464
GMI 0.80660.93270.91830.96120.9391.10121.21270.84560.97891.0299
AQI 0.92260.80662.01840.94380.94431.04110.99950.86741.06610.9193
SGI 1.13261.14511.2591.42330.87781.09381.15551.41171.10181.2037
DEPI 0.98661.01181.33160.83411.18470.9611.03630.98211.11011.02
SGAI 0.95940.85011.05260.90391.15040.90090.94970.91191.04561.1973
LVGI 0.97021.00220.58280.60650.93690.76261.4421.03121.05091.0641
TATA -0.0342-0.0295-0.0244-0.024-0.0523-0.0186-0.01810.0386-0.027-0.002
M-score -2.56-2.48-1.78-2.34-2.89-2.31-2.37-2.08-2.53-2.33

Quanta Services Inc Quarterly Data

Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15
DSRI 0.98010.87170.90790.83190.98351.07871.09521.09351.04640.9188
GMI 0.84560.90380.89660.91310.97890.98571.02031.02621.02991.068
AQI 0.86740.87530.8761.02231.06611.09241.08340.92240.91930.9207
SGI 1.41171.32171.2411.19671.10181.08461.13161.1941.20371.1904
DEPI 0.98210.98971.00711.03471.11011.08431.0391.00261.020.9824
SGAI 0.91190.98961.03881.03741.04561.14761.1061.15871.19731.0472
LVGI 1.03121.00380.91810.87851.05091.05221.06551.10751.06411.1913
TATA 0.03940.02430.019-0.0084-0.027-0.01210.00450.0075-0.0018-0.0426
M-score -2.08-2.30-2.34-2.50-2.53-2.39-2.24-2.27-2.33-2.65
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